Bombardier names new head of troubled train unit after three years

Christopher Reynolds

Bombardier Inc. has announced a new head for its troubled train-making segment, naming Danny Di Perna, shown in a handout photo, president of Bombardier Transportation effective immediately.THE CANADIAN PRESS/HO-Bombardier MANDATORY CREDIT

February 07, 2019 - 12:35 PM

MONTREAL - Bombardier Inc. announced a leadership shakeup Thursday, naming a new head of the company's troubled train unit after his predecessor resigned.

Danny Di Perna, 53, has replaced Laurent Troger, 55, who took on the role in December 2015 after 11 years with the company, Bombardier said.

Di Perna, who will report directly to chief executive Alain Bellemare, joined Bombardier in November to lead its aerostructures and engineering segment after leaving GE Power, where he was vice-president of global sourcing.

Troger, whose total compensation was US$5.15 million in 2017, opted to leave Bombardier, according to spokesman Eric Prudhomme.

The abrupt announcement comes as the Montreal-based company enters the final two years of a five-year turnaround after the plane-and-train maker sold a majority share of its C Series commercial aircraft program to Europe's Airbus in July, turning its focus to higher-yielding business jets as demand for the jetliners gains elevation.

Analyst Cameron Doerksen of National Bank Financial said he was "surprised" by the executive shakeup, given that Di Perna signed on with the company a few months ago. But the change "does not reflect financial challenges," he added in an investor note, as Troger oversaw an expected bump in the margin of earnings before interest and taxes to 8.5 per cent in 2018 from 5.6 per cent 2015.

Over the past decade, delays and repair problems have plagued Bombardier train contracts including Toronto's streetcar and light-rail train orders.

Last Friday, Metrolinx announced it would impose financial penalties on Bombardier after the Montreal-based company delivered only half of a promised six vehicles for Toronto's Eglinton Crosstown LRT by the Friday deadline. Difficulties have hampered the $392-million vehicle order tied to the midtown line now under construction along and underneath Eglinton Avenue, with legal battles leading to a reduced order for 76 cars in 2017, down from a planned 182 cars in 2010.

Last month, three international public transit agencies opted to stop taking trains from the company until it fixes the ones already in service.

Swiss Federal Railways cited doors that don’t close properly, putting the brakes on deliveries under its US$1.9-billion contract for 62 trains.

The head of the New York City Transit Authority, Andy Byford – former CEO of the Toronto Transit Commission – halted subway car deliveries more than two weeks ago, citing HVAC software system defects and claiming “deja vu” over issues with Bombardier trains.

“It’s gruelling. You have to stay on their case, you have to hold their hands, you have to cajole them,” Byford said at a Metropolitan Transportation Authority committee meeting on Jan. 21, citing past problems with springs between the cars and doors that were “weeping oil.”

Deliveries to New York resumed last week.

“We understand the frustration and we own the issue,” said Bombardier's Prudhomme said in an email last month. “It’s not unusual in the industry to have some issues, particularly in the early stages of passenger service.”

On Jan. 31, the French National Railway Company announced it would stop train car deliveries, pointing to an “unacceptable situation of non-quality” with some of the 32 trains it had received, adding that 42 were supposed to have arrived by the start of the year.

Bombardier Transportation remains the company's highest-revenue segment, raking in more than half of the company's US$16.2 billion in revenues in 2017.

Its new president has more than 30 years of industry experience, the company said. Born in Montreal, Di Perna is the first Canadian to head Bombardier Transportation since Pierre Lortie left the company in 2003, said Prudhomme.

"Danny is an exceptional and engaging leader with a proven record of leading complex industrial organizations,” said Alain Bellemare in a statement Thursday thanking Troger for his contributions to the company.

Troger, during his three years conducting the train segment, "significantly grew its backlog, optimized its footprint and executed an aggressive production ramp-up," the CEO said.

Paul Sislian succeeds Di Perna as the new head of aerostructures and engineering services after leading the business aircraft team, overseeing Bombardier's push toward higher-yielding business jets.

Nancy Barber takes over at Sislian's old post after 20 years with the company, most recently as a vice-president managing the Global 7500 jetliner and new aircraft studies.